Department of the Interior


Joint News Release
For Immediate Release
Nov. 16, 2005

DOI: John Wright, (202) 208-6416
USDA: Dan Jiron, (202) 205-0896
NOAA: Connie Barclay, (301) 713-2370

Federal Agencies Announce New Hydropower Rules to Ensure Consideration of Environmental and Economic Values
The rules meet requirements of the 2005 Energy Policy Act

The departments of the Interior, Commerce, and Agriculture announced today new Interim Final Rules to improve licensing procedures for hydropower while protecting threatened and endangered fish species, water quality, and federal and tribal resources. The rules mark the first time that the three departments have established joint procedures for dispute resolution regarding hydropower licensing.

The new rules, which will be effective immediately as mandated by the Energy Policy Act of 2005, will be published in the Federal Register on Nov. 17, 2005. The public will have 60 days to review and submit comments on the rules, which could result in changes in a revised Final Rule.

The Energy Policy Act of 2005 (Sec. 241) requires the departments of the Interior, Commerce, and Agriculture to jointly develop a rule in consultation with the Federal Energy Regulatory Commission (FERC), that enables hydropower license applicants and other parties to hydropower license proceedings to request trial-type hearings on disputed issues of material fact, such as whether fish were historically present in a river. These issues relate to conditions or prescriptions that may be developed by one or more of the departments to address the above mentioned concerns. The Energy Policy Act passed by wide margins in both Houses of Congress after years of congressional consideration of ways to improve hydropower licensing.

Hydropower licenses authorize operations for decades, after which the facilities must be relicensed for operations to continue. Relicensing is an opportunity to deal with specific resource protection concerns, such as enabling fish passage for species listed as threatened or endangered or to improve water quality. However, conditions or prescriptions may require utilities to incur significant costs that may in turn affect their consumers. In some cases, utilities have expressed concern that these costs are excessive. Other stakeholders have on occasion argued that some conditions are not stringent enough to protect important natural resources such as native salmon and trout.

In accordance with the Act, the Interim Final Rules announced today provide for expedited hearings before an administrative law judge. The participating parties will be able to present evidence and examine witnesses as in similar administrative proceedings. The rules include details on how to request hearings, materials that are required and time frames.

The Act also allows applicants and other parties to license proceedings to submit alternative conditions or prescriptions for consideration by the respective federal departments, which will accept them unless they make specific findings as to why they cannot. Such alternatives might propose ways to lower costs to utilities and consumers while still protecting critical resources. The Interim Final Rules include details on how and where to submit alternative conditions or prescriptions for consideration.

Hydropower is an important part of the nation's energy infrastructure. It provides about 7 percent of America's electricity nationally. Hydropower licenses for non-federal operations including many dams are issued by FERC. Conditions or prescriptions are developed by federal agencies such as the Interior Department's U.S. Fish and Wildlife Service, Bureau of Land Management, and the Bureau of Indian Affairs; the Department of Commerce's National Marine Fisheries Service; and the Department of Agriculture's U.S. Forest Service. The Federal Power Act authorizes agencies to provide to FERC these conditions or prescriptions to address the need for fishways, water quality protection, and to protect Indian Trust values such as critical fisheries.

The new processes Congress has enacted are open to license applicants and other parties that may include Indian Tribes, states and other governmental units and nongovernmental organizations, such as environmental groups. They apply to any current license proceeding before FERC, i.e., one in which a license has not yet been issued, as well as to all future license proceedings. Both the trial-type hearings and the process for the submittal and consideration of alternative conditions and prescriptions will be completed within the tight timeframe mandated by FERC's licensing rules.

The rules are effective immediately as Interim Final Rules. A proposed rule is not being issued because Congress made clear its intent that a rule be put in place 90 days after enactment of the Energy Policy Act. The public will have 60 days from the date of publication in the Federal Register to comment on the rules. The departments will consider the comments and their initial experience in implementing the new processes, and consider issuing revised Final Rules within approximately 18 months.